Sarkozy has called for a thorough rethinking of capitalism
The French President Nicolas Sarkozy called for a thorough rethinking of capitalism because of the lessons from the financial crisis. In his statement at the World Economic Forum which takes place this week in the Swiss town of Davos, he said the economy needs fundamental change. His comment came after bankers and regulators involved in the forum to miff on the proposal to divide the large banks, which endangers the functioning of the entire financial system, police BBC. The French president said he wanted to restore “moral dimension” of free trade. He warned that unless steps are taken to change this would be an expression of great irresponsibility on the part of the leading figures in politics and economics involved in the international event in the Swiss alpine resort. France supported the banks plan to increase its capital to impose limits on bonuses paid in the banking sector. U.S. President Barack Obama has proposed to reduce the size of large banks, for which purpose they are prohibited to hold hedge funds and impose strict limits on the risk they bear when they trade in financial instruments. The Representatives of the banking sector in Davos, however, have welcomed these proposals cool. Against the backdrop of meager applause Sarkozy noted that governments and companies around the world should not behave as if nothing has happened to the economy over the past three years.
According to him the main question now is not whether to replace capitalism, and what kind of capitalism should have. Therefore, he urged participants in the forum of political and financial leaders to restore the moral dimension and the conscience of the capitalist order. The French president noted that successful managers of large banks and companies deserve to be well paid, but strongly criticized the huge bonuses to the bankers, who are led to great public outcry in the U.S. and UK. Sarkozy noted that some banks in the scheme for payment of bonuses unrelated to performance management and that management should not be allowed. Yesterday the legendary investor George Soros supported the proposal of U.S. President Barack Obama to reform the banking sector by dividing the large banks.
Tags: capitalism, Davos, Nicolas Sarkozy, Sarkozy